An “international currency war” has broken out, according to Guido Mantega, Brazil’s finance minister, as governments around the globe compete to lower their exchange rates to boost competitiveness.

Mr Mantega’s comments in São Paulo on Monday follow a series of recent interventions by central banks, in Japan, South Korea and Taiwan in an effort to make their currencies cheaper. China, an export powerhouse, has continued to suppress the value of the renminbi, in spite of pressure from the US to allow it to rise, while officials from countries ranging from Singapore to Colombia have issued warnings over the strength of their currencies.

The worst is that this reaction of these dumb-ass third world* central bankers isn't really Keynesian.The reason they want to devaluate their currencies is because they want to boost exports. You know, it's always better to sell than to buy, right hein?

Impressive. It's pure "mercantilism", centuries after it has been proved a wrong economic thought.

And then, of course, the means through which they will promote this devaluation is through Keynesian ideas, what will make things even worse than plain simple inflation. Following a bad idea through horrible means.